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THE TRAMWAYS TRUST.
fltftt. HOLDEN'S RESIGNATION.
REPORT TO THE GOVERNMENT.
A voluminous report was last week pre-
sented to the Government by its repre-
sentatives on the Tramways Trust dealing
with the recent rumors current In regard
to contracts. The representatives (Messrs.
A. B. Moncrieff, C.M.G.. and Thomas Gill,
C.M.G., I.S.O.) state, inter alia:—
With regard to the question of making a
public statement about Mr. Holden's re-
signation, the Trust has throughout taken
up this position:— (a) Mr. Holden re-
signed entirely on his own initiative and ;
for personal reasons, (b) Such resigna-
tion was outside the control of the Trust,
and it was for Mr. Holden to decide for
himself whether, in his opinion, such re-
signation was justified or necessary, (c)
The reasons for such resignation being per
sonal, no one but Mr. Holden could or
can state authoritatively exactly what
those reasons were. (d) Mr. Holden's
position as a member of the Trust was
not in a personal capacity, but as an elec-
ted representative of the suburban munici-
palities. If his reasons for resigning were
of such as nature as, in his opinion, to
affect the interests of his constituents, it
was his duty, and not the duty of the
Trust, to take such into his confidence
and explain euch reasons to them, (e) In
his letter of resignation, obviously pre-
pared for publication, Mr. Holden
threatened to give a copy thereof to the
press. The tone of his letter was such
that the Trust was compelled to make
its position and the position of Mr. Holden
quite clear, so that if Mr. Holden carried
out his threat and published the corre-
spondence the public would hear both
sides. For these reasons the Trust felt
that the first move in regard to publicity
should come from Mr. Holden. It there-
fore waited for Mr. Holden to come out
into the open and give his reasons if he so
desired.
Dealing with an order for bags the
report says:— A number of firms sup-
plied samples and gave prices. On De-
cember 10, 1917, Wheeler & Co. tendered
for the supply of 100 bags at 45/-, as per
sample. This sample had been manufac-
tured by the firm of Holden & Frost.
The traffic and works committee on
December 13, 1917, approved the accep-
tance of this offer, but at a meeting on De-
cember 18, 1917, the minute was with-
drawn, such withdrawal being minuted in
Mr. Holden's writing, and the question so
far as regards a formal contract remained
in abeyance from December 10, 1917, until
March 7, 1918. On that date the acting
general manager sent a minute to the traf-
fic and works committee, asking for au-
thority to place the order with Holden
and Frost, Limited. Mr. Holden at such
meeting intimated that the arrangements
for turning his business into a limited com-
pany had not been completed, and the
minute was held over, and on May 16, 1918,
a similar minute was approved. The for-
mal purchase order was sent to Holden and
Frost, Limited. In the meantime the bags
in question were being manufactured and
delivered direct by tho firm of Holden and
Frost. Four of the cart-notes for different
deliveries during March, 1918, were ex-
pressed to be on loan. The thin disguise
afforded by the fact that the tender was
in the name of Wheeler & Co. was
dropped, and the words "on loan" must be
presumed to bs inserted in the cart-notes
for the protection of Holden & Frost, so
that if challenged it could be said there
was no contract with them, which would
result in Mr. Holden's disqualification. As
far as the Trust was concerned the goods
were taken into stock and used as re-
quired. On June 4, 1918, Wheeler & Co.
wrote asking the Trust to note that this
contract had been transferred to Holden
and Frost, Limited, who will receive pay-
ment for the goods delivered.
Caps Made in South Australia.
The acting general manager, in a minute
which came before the board on November
7, 1917, asked permission to place an order
for 300 caps with a New Zealand firm, at
5/6 each, f.o.b. Dunedin. The chairman
of the traffic and works committee (Mr.
Holden) expressed a deslre to keep the
work in the State, if possible, and asked
that the matter be held over pending en-
quiries. This was done, and two Adelaide
firms were approached by the acting gene-
ral manager, but they were not able to
manufacture. It is not true, as stated by
Mr. Holden, that he asked that enquiries
should be made in Melbourne and Sydney,
nor that the subsequent reports stated
that it was impossible to get the articles
in Australia. There were no enquiries
made, either in Melbourne or Sydney, and
no reports, except relating to the two
firms in Adelaide. The matter only came
up on November 7, and on November 14,
without any negotiation between Wheeler
and Co. and the Trust, a quotation was
received from that firm for 2,000 caps at
8/- each. No doubt Wheeler & Co. would
have preferred a contract for 2,000, but
they were the only people who ever men-
tioned such a number. The acting general
manager on November 15 recommended
that a trial order of 500 be placed for
caps, and this order was approved and
placed with Wheeler & Co. on November
23. The caps were delivered at the depot
on April 8, 1918, with a car-note, 'Please
receive the undermentioned goods to car
depot, on loan, 500 caps, five sample caps
returned. From Holden & Frost'
A Contract Transferred.
On May 8, 1918, Holden & Frost became
a limited company. On May 20, 1918, a
duplicate of the order to "Wheeler & Co."
of November 28, 1917, was issued in the
name of Holden & Frost, Limited, and on
the same day that company forwarded to
the Trust an invoice for the capa. On
June 4, 1918, the acting general manager
received a letter from Wheeler & Co.,
asking him to note that this contract had
been transferred to Holden & Frost,
Limited, who will receive payment for the
goods delivered. Thia trial order of caps
turned out most unsatisfactory, the caps
supplied not comparing in any way with
the New Zealand caps, for which tb»y
were substituted. Mr. Holden, in his
statement dealing with these two con-
tracts, omits to state that the orders were
given to Wheeler & Co., and to explain
how Wheeler & Co. came into these mat-
ters. He winds up his statement by say-
ing that these two matters are the only
two matters that his company has had
with the Trust. Even as regards his com-
pany this statement is only partly true,
for his company did practically nothing
except collect the money. The material
parts of both these transactions were not
with the company, but with the firm of
Holden & Frost, per Wheeler & Co., and
a similar practice had been adopted pre-
viously.
A Series of Allegations.
"On July 12, 1910, the Trust's solioitor
advised as to the lability of members of
the Trust who sub-contracted with per-
sons holding contracts with the Trust,
and a copy of this opinion was handed
to each member two days later."
The report proceeds to set out in order
of date the events which culminated in
Mr. Holden's resignation. At a meeting
on July 2, 1918, at the request of Mr.
Sherriff, the Trust directed that the acting
general manager should report on the
following matters:— (a) Contracts for
brake shoes ordered just prior to June,
1918, and alleged to be in excess of re-
quirements., (b) Alleged absences from
duty of the acting general manager. (3)
Work done and material supplied by the
Trust for a member, (d) Contract for
caps and conductors' bags. On July 9,
1918, the acting general manager reported
to the Trust on all these mat-
ters, and at the conclusion of
his report, stated: — "Having now
answered the questions, and, in my
opinion, disposed of these innuendoes,
Mr. Sheriff may now regard it as
reasonable to disclose the name of his in-
formant, who by falsehood tried to do
personal injury by making untrue state-
ments. Unless this is done the manage-
ment of the Trust will always be faced
with a feeling of distrust of some unknown
officer who is disloyal to the service, and
suspicion may rest upon some person who
is quite innocent in this respect." On
August 13, 1918, a special committed sub-
mitted a report which found: — "(a) As to
the brake shoe contracts, it was satisfied
with the acting general manager's action.
(b) As to the alleged absences from duty
of the acting general manager, that such
allegations were totally unfounded, and
that the committee have absolute con-
fidence in him. (c) As to work done and
material supplied for a member, that every-
thing had been fully paid for before the
question had been asked (as certified by
the accountant), and while there is no
doubt what everything is in order in this
respect we consider that it would be ad-
visible for tho future for members to make
no purchases through, or have any work
done by, the Trust. (d) The explanation
as to the cap and bag contracts was ac-
cepted." It was disclosed that it was Mr.
Holden, and not, as the acting genera1
manager thought, an official, who had sup-
plied Mr. Sherriff with the material for
his questions. The report of the committee
concluded by stating: — "We are of opinion
that in regard to the last paragraph of the
acting general manager's report the allega-
tions must be unreservedly withdrawn."
The report was received and adopted by the
Trust. Mr. Holden declined to withdraw.
At the same meeting, upon the motion of
Mr. Cruickshank, all offices in the finance
and traffic and works committees were de-
clared vacant. Mr. Holden did not vote.
A Repudiation by Mr. Forward.
The report also deals with an alle-
gation concerning "a member of the
Trust making notes of prices in a private
book when confirming orders." It
states: — "All orders are confirmed by the
Trust and initialled by any member. The
orders are, of course, laid on the board
table, and are available for the inspection
of all the members. We have been in-
formed that on one occasion Mr. Sher-
rlff spoke to Mr. Forward about taking
notes. Mr. Forward has from time to
time rendered considerable service to the
Trust by watching prices, and as a con-
sequent result of information given by him
as to Melbourne and Sydney prices buy-
ing agencies in those places have been ar-
ranged. Mr. Forward indignantly repudiates
any suggestion that the knowledge of prices
obtained through seeing Trust orders
has been used by him in any way to the
detriment of other contractors with the
Trust, or to the advantage of the company
with which he is connected. The matter
of making a note even in a private
note-book is merely introduced to create an
atmosphere. One man makes a written note
where another makes a mental one, and
Mr. Forward was in the same position as
Mr. Holden as regards the opportunity to
see what the prices were. The only dif-
ference is that Mr. Holden for the 11 years
he acted as chairman of traffic and works
would see all the prices. The matter in
reference to the contract for brake shoes,
1918, was fully investigated by the special
committee and dealt with. Mr. Holden
suddenly discovered that public tenders
should nave been called. This was es-
sentially a matter for the traffic and works
committee, and more particularly for him-
self as chairman.
"Mr. Holden is inaccurate when he says
that Martin & Co.'s price of £18 per ton
was the lowest of five quotations received
up to January 11. The firms and the
prices find the dates of receipt of quota-
tions are as follow:—
Jan. 4, 1918, Martin & Co.. .. .. £18
Jan. 5, Perry & Co .. .. .. .. .. £21 10/
Jan. 10, Harley & Co. .. .. .. .. £28
Jan. 14, Simpson & Son .. .. £19 7/10½
Jan. 17, Bagshaw & Co. .. .. £24
Jan. 21, Forwood & Co. .. .. £17 15/
A Suggestion Denied.
"On January 7, 1918, a purchase order was
issued to Martin & Co., whose price
was the lowest then received. This order
was approved at the Trust meeting on
January 10, 1918, and initialled by mem-
ber (Mr. Forward) in the ordinary course
of the business of the Trust. Mr. Holden
says:— :On or about the 19th (January,
1918) the controller of stores was asked
by the acting general manager over the
telephone if he had this tenders for brake
shoes handy, and to give particulars. He
replied, giving the names of the tenderers
and prices. Martin Bros. being the
lowest up to that time— £18. After quot-
ing the prices the controller of stores at
once proceeded to the administrative build-
ing and met a gentleman leaving the
acting engineer's office. Subsequently a
tender was received for £17 15/. We
understand that the gentleman referred to
is alleged to be Mr. Forwood, jun. This
statement is absolutely denied by the
acting general manager. Mr. Forwood,
jun., also emphatically denies the sugges-
tion that he obtained the names and
prices of any other firm. Mr. Holden
proceeds:— "The Trust, I believe, desire
that all tenders or prices should be re-
ceived at the same time and opened to-
gether, and this was not done." The sug-
gestion that the Trust desires that all
tenders and prices should be received at
the same time is nonsensical, as Mr. Hol-
den well knows. Tenders and prices are
sent in when the persons giving them
please. Tenders are always opened at the
same time and in the presence of the full
Trust. Letters containing prices are
opened in the ordinary course of business
as they arrive."
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